On 3 November 2015, the IRS published a new question on the list of IDES Technical FAQs concerning notifications received by users that their file was not downloaded (Link). The IRS explained that files containing invalid dates in the metadata could not be automatically downloaded and gave further instructions on how to properly populate dates into the files.
In addition, the second FATCA ICMM FAQ on Failed Threat Scan Notification (NTD) has been updated in order to include information on how to detect threats.
The Global IT Forum provides updates on International Data Exchange Service (IDES) developments and presents an opportunity to discuss technical questions with host country tax authorities (HCTAs), financial institutions, and related industry organizations. Global IT forum sessions are held monthly. Details about upcoming Global IT Forum sessions are emailed to all registered participants (Link).
The FATCA XML Schemas and Business Rules for Form 8966 page has been updated and now includes information about FATCA Notifications XML v2.1. The links on the webpage provide guidance on how to validate reporting schemas (Link).
On 31 October 2015, the list of excluded accounts and non-reporting financial institutions per Member State was published in the Official Journal of the European Union (Link).
In early November 2015, the U.S. signed Competent Authority Arrangements (“CAAs”) with Ireland (Link) and Isle of Man (Link) in accordance with the IGAs previously signed with these jurisdictions. In general, a Competent Authority Arrangement is a bilateral agreement between the U.S. and a treaty partner to clarify or interpret treaty provisions (Link). These CAAs establish the procedures for the automatic exchange obligations and for the exchange of information between these jurisdictions.
On 13 October 2015, the Jersey draft CRS law [Draft Taxation (Implementation) (International Tax Compliance) (Common Reporting Standard)(Jersey) Regulations 201] was lodged au Greffe (Link). The Proposal for the ratification of the Multilateral Competent Authority Agreement implementing CRS was also lodged au Greffe on the same day (Link). If ratified, the draft law will be effective on 1 January 2016.
On 28 October 2015, the European Union signed an agreement on the automatic exchange of financial account information with Liechtenstein (Link). This Treaty is aimed at improving international tax compliance and combatting tax evasion and tax fraud. The first automatic exchange of information will take place in 2017 for information collected in 2016.
On 9 November 2015, Angola signed a Model 1 Intergovernmental Agreement (“IGA”) with the United States of America to improve international tax compliance and to implement FATCA (Link).
On 5 November 2015, the Mexican Tax Authorities (Servicio de Administración Tributaria or SAT) announced a temporary reopening of their FATCA reporting system for a period of three days from 9 November 2015, enabling the SAT to receive overdue FATCA reports.
This means that financial institutions that were not able to report by the FATCA reporting deadline on 15 September 2015, will have a short period to comply with outstanding FATCA reporting obligations.
The announcement by the SAT includes certain restrictions on the conditions under which this reporting facility will be available, including:
- The financial institution must already have registered and obtained its reporting certificate(s);
- The financial institution must inform the SAT of its intention to use this reporting window;
- The financial institution was not able to submit reports by 15 September 2015.
It’s important to note that the facility will not be available to those financial institutions that wish to submit supplemental or amended FATCA reports.
If you were not able to fulfill all of your FATCA reporting obligations by 15 September 2015 or would like to discuss what this new announcement could mean for your institution in more detail, please get in touch with our experts.
Karina Perez Delgadillo
On 5 November 2015, the Internal Revenue Service (“IRS”) released the final Form 8938 for 2015 (Link) and instructions on how to complete the form (Link). Form 8938 should be filed by specified individuals with interests in specified foreign financial assets where the value of those assets meet or exceed the reporting threshold. Therefore, this reporting should be the responsibility of the account holder, and not the institution in which the account is held (i.e. Form 8966 or similar financial institution reporting in IGA countries). This form should be attached to a filers annual tax return and filed by the due date, including extensions, for that return (e.g. Form 1040, Form 1040NR)
The draft form was released in October (previous blog coverage).